Interview – Ron Knecht, Candidate for Controller
These interviews are posted on Nevada News & Views (www.nevadanewsandviews.com) and/or NewsDesk by Nancy Dallas (www.ndbynd.com). Reposting of any interview by interested parties must include the disclaimer the interview was originally posted in the above publications. Questions or comments may be directed to Nancy Dallas at email@example.com or 775-847-0129.
- Why are you running for Nevada State Controller
I’ll run the Controller’s office efficiently and to the highest professional standards, assuring integrity, rigor, candor, transparency and accountability. Those traits have been the hallmarks of my service in elected and appointed offices and in my long professional career, so voters can be sure I’ll take care of the nuts and bolts aspects as Controller. But more than that, I’m running as One Plain-speaking Nerd who will bring to the job new energy, ideas and wide experience serving voters and taxpayers.
Nevadans deserve more than just an accountant – they deserve someone who has already plowed through the deep gray mass of financial and other reports to find and highlight the key information voters and taxpayers need. I’ll go beyond the basic duty to be Nevada’s Chief Fiscal Officer and give real meaning and substance to the further duties listed on the state web page: “The controller also provides citizens, state agencies, local governments and legislators with accurate and impartial financial information … [and] protects the citizens’ money by ensuring that it is properly accounted for and spent in the most efficient and cost effective manner at all times.” I’ve got an unmatched record in public office of doing that kind of work, and I’m running for Controller because it’s the best place to do that kind of public service that I so love.
Instead of only publishing thick, gray, eye-glazing documents such as the Comprehensive Annual Financial Report, I’ll also dig out and publicize in plain language and clear graphics the key facts and data that citizens, taxpayers and public officials need to judge the efficiency and cost-effectiveness of government operations and policies. I’ll also use the auditing, investigatory and other powers of the office to make all relevant, practical inquiries about state and local operations, policies and activities. And I’ll publicize the results for the benefit of citizens, taxpayers and efficient, effective, transparent and accountable government. In my public service, professional work, publications and speaking, I’ve already compiled an extensive body of such work, and I’ll continue to add to it. As Controller, I’ll report regularly to you the information and data you need and deserve.
- Give a brief summation of your professional and political background.
I’m an economist, financial and policy analyst, Registered Professional Mechanical Engineer (in CA), and law school graduate. I’ve spent half my 43 working years in public service / education and half in private entrepreneurial small business, all in professional, supervisory and managerial positions. I conduct a wide range of economic, financial, technical and policy analyses and have written and testified extensively as an expert witness about 150 times in all those areas. In 2001-12, I worked at Nevada’s Public Utilities Commission, ending my tenure there as Senior Economist, and I now work as a consultant. I’ve taught college economics and related subjects, and I’ve co-taught numerous two-day seminars for SNL Financial on utility finance, cost of capital, economic and policy issues for regulators, professionals, managers, securities analysts and others from around the country and Canada. I’ve also taught seminars and delivered major lectures for many parties on valuations and a wide range of economic, financial, technical and policy matters. In private business, I’ve been a founder, Chief Executive Officer, Chief Financial Officer, Vice-president, Principal and/or board member (Director) with six different firms. I’ve been a founder, board member (Director), Chairman and/or Executive Director for a like number of charitable and public-interest groups.
I was elected to the Board of Regents of the Nevada System of Higher Education in 2006 as the representative for District 9 (the Lake Tahoe area of Carson City, Douglas, Lyon and Storey counties and southern Washoe County). For two years, I chaired the Business & Finance (budget) Committee and for one year I was Vice-chairman. I chaired the Board’s Audit Committee in 2007-08 and 2013-14. I’ve also served on the Research & Economic Development, Health Sciences System, Board Development, and Cultural Diversity & Security committees and various institutional presidential selection and performance review committees, chairing two of them. I was re-elected in 2012 to another six-year term (with Churchill, Esmeralda, Lander and Mineral counties added to my district, but with less of Washoe County). For the last three years, I’ve led the fight against college and university tuition and fee hikes, noting that some fees have doubled while the incomes of Nevadans paying them have actually declined. I was elected to the Nevada Assembly for 2002-04, representing District 40 (Carson and Washoe Cities). In the Assembly, I was a leader of the “Mean 15” who stopped the gross receipts tax, the largest single tax increase ever proposed for Nevada. Previously, I served in various appointed public offices and have been active in the Republican Party for 20 years.
The most important things in my life are my wife, Kathy, our twelve-year-old daughter, Karyn, and our mothers and families. Born and raised in a small town in the Midwest, I have a lifetime record in public, community, charitable and professional services, and in writing, speaking and teaching. With some scholarship support, I worked my way through undergraduate and early graduate studies at a public university (BA in Liberal Arts & Sciences at Illinois, major in mathematics and minor in physics and chemistry; plus graduate work in Civil Engineering). Spending most of my working career in San Francisco and Silicon Valley, I paid my way at private graduate and law schools (MS in Engineering Economic Systems at Stanford and JD at San Francisco) while working full time. I’ve been a Nevadan By Choice since 2001, and a columnist for various papers and on-line publications as well as doing other public service. (See additional details in my resume posted on line at www.RonKnecht.com.)
- Define your political philosophy.
I’m a limited-government, libertarian, constitutional conservative (also known as classic liberal, not a PC statist modern liberal). Long ago, I signed the Taxpayer Protection Pledge, and I consider it still binding. I will oppose any net increase in tax levels relative to our economy (while allowing for fair, reasonable and economically efficient realignment of existing tax burdens). Because government is already too big (that is, larger, more intrusive and over-reaching than the levels that maximize economic growth, fairness and human flourishing), I support reducing over time the overall fraction of the economy that goes to taxes and public spending. Also, I support reduced and more sensible regulation and greatly reduced public deficit, debt and entitlements levels. As a Nevada legislator, my first act was to submit a bill draft request for state constitutional tax and spending limits.
In addition to a strong belief in private property rights and economic freedom, I’m an ardent supporter of individual rights, not the inherently unfair so-called “group rights”. We must rely on personal liberty and families – and on competitive markets and limited, constitutional government — to grow the pie, and we should not engage in negative- or zero-sum fights to “redistribute” it. I’ve been active in the education excellence and reform movements, supporting especially parental school choice; I was the only regent to vote against endorsing “common core” for K-12. Environmental and public health and safety regulations should be limited to those measures that are socially cost-effective. We need extensive legal reform to rein in the excesses of some lawyers and litigants. As a NRA Life Member, I support and understand the value of the 2nd Amendment, assuring the right and means of self-defense, as well as the rest of the Bill of Rights.
Above all, I believe in the rule of law and the supremacy of our federal and state constitutions as a bulwark against government excess and a framework for free people to thrive and be productive in harmony. Moreover, I understand and appreciate that America, its governing principles, and its people are (contrary to Barack Obama and the PC statist liberals) truly exceptional – a beacon for people around the world. I’m concerned that we are losing that heritage, and I’m determined to fight to strengthen it and leave it as our legacy to my daughter’s and succeeding generations. As a Nevada Assemblyman, my first floor act was to sponsor the 2003 Ronald Reagan birthday resolution. Finally on this question, we need to get Nevada land back from the federal government and into private ownership.
- How much do you project this campaign will cost? Do you anticipate using your own money to help finance it? If so, to what degree?
I expect it to cost $250,000 and am aiming higher. In the past, I have contributed five-figure amounts to some of my campaigns, and I will again do what I can and I must.
- What makes you more qualified than your Primary opponents to serve as Controller?
As detailed below, I have a long and productive record in public service and professional achievement that none of my opponent’s approaches; particularly, I have a record in elected political office and in working and fighting effectively for taxpayers, liberty and the broad public interest that none of them comes close to matching. Further, for over two decades, I’ve been a reliable voice and vote to protect taxpayers, having defeated a proposed tax increase in California before coming to Nevada.
In two terms chairing the regents’ Audit Committee, I’ve led in making audits tools for improving the performance of colleges and universities. I initiated audits of faculty workload and space utilization to assure that taxpayers get their money’s worth and of account balances to improve accountability and transparency. As a Republican and chairman of Audit, I’ve worked very closely and well with the Democrat who serves as vice-chairwoman; we were publicly thanked at the most recent board meeting by the regents’ chairman for leading NSHE through difficult times after its largest college failed a federal audit.
I’ve also served two terms as chairman and once as vice-chairman of the regents’ Budget & Finance Committee. In that role and others, I’ve become well-known around the state for insightful tax, revenue and spending analyses, usually featuring colorful graphs that debunk common misconceptions. For example, I pointed out that since 1994, real per-person state general fund spending has risen by 28 percent while the incomes of Nevada families and businesses that pay taxes to support that spending rose only 8 percent. On the regents’ Investment Committee, overseeing more than $900-million of funds, I’ve led the way toward modern portfolio management focused on earning maximum returns while keeping risk levels low and keeping investment fees low. These policies help fund improved higher education while minimizing its burdens on taxpayers and students.
As an expert witness in economic, financial, technical and policy matters, I’ve testified about 150 times in regulatory and court dockets and legislative hearings and withstood well aggressive cross-examination by many outstanding and tough lawyers. As a senior staff witness at the Nevada and California public utilities commissions and an independent expert witness in 20+ other jurisdictions, my testimony has helped save utility ratepayers hundreds of millions of dollars. My experience in the Assembly gives me a leg up not just on governmental processes and working with others, but also on the matters with which the Controller deals. It also proved my mettle as being able to keep campaign promises and withstand the pressure in politics to compromise the public interest under pressure from special interests.
- Define your understanding of the duties/responsibilities required of the Controller.
While Article 5, Section 19 of the Nevada Constitution creates the position of Controller, it says very little about the duties. They are detailed in Nevada Revised Statutes (NRS) Chapter 227 and summarized on the Controller’s web site. The Controller is Nevada’s Chief Fiscal Officer (CFO) and as such, processes and records the state’s financial transactions, conducts the final audit, ensures compliance with our constitution, federal laws and state statutes, and administers the state’s accounting system, settling all claims against the state and collecting debts owed to it. The Controller publishes the Comprehensive Annual Financial Report (CAFR), Citizen Centric Annual Financial Report (CCR), Quarterly Financial Statements of the Permanent School Fund, Single Audit Report, Quarterly ARRA Report to Our Citizens and the Annual Intergovernmental Financial Dependency Report.
Importantly, the Controller also provides the citizens, state agencies, local governments and legislators with accurate and impartial financial information. Nevada’s Controller protects the citizens’ money by ensuring it is properly accounted for and spent in the most efficient and cost-effective manner at all times. The office’s stated mission is to advance accountability, continuity and efficiency in the state’s financial operations.
- What do you see as the most pressing issues facing the State as related to the Controller’s office? How do you propose to resolve them?
As noted above, I’ll bring new energy, ideas and experience especially to the public and other information aspects of the job, especially via the CAFR and CCR. These are the kinds of things I’ve been doing for over seven years as a regent and in my previous service in the Legislature and appointed office, as well as in my newspaper and on-line columns. I’ll dig out and publicize in plain language, tables and clear graphics the key facts and data that citizens, taxpayers and public officials need to judge the efficiency and cost-effectiveness of government operations and policies. I’ll also use the auditing, investigatory and other powers of the office to make all relevant, practical inquiries about state and local operations, policies and activities. And I’ll publicize the results for the benefit of citizens, taxpayers and efficient, effective, transparent and accountable government. In my public service, professional work, publications and speaking, I’ve already compiled an extensive body of such work, and I’ll continue to add to it. As Controller, I’ll report regularly to you the information and data you need and deserve.
As examples of new things I would do as Controller, consider the proposed margins tax. If I were Controller now, the web site would carry in-depth economic and fiscal analysis of the damage this proposal would do to Nevada families and businesses and to our state, while also doing nothing to assure additional education funding. Also, it would feature analyses debunking budget-cut claims made as a pretext for increasing taxes, and much more. Although the Controller does not levy taxes, one of his jobs is to inform taxpayers how their dollars are being spent and ensure they are always spent efficiently and cost-effectively. I’m One Plain-speaking Nerd who will bring to the job new energy, ideas and wide experience serving voters and taxpayers, as reflected above in my point that state spending has risen much faster than the incomes of Nevada families and businesses paying the bill for that spending.
As in all my work and public service, I’ll run the Controller’s office efficiently and to the highest professional standards, assuring integrity, rigor, candor, transparency and accountability. Those traits have been the hallmarks of my service in elected and appointed offices and in my long professional career, so voters can be sure I’ll take care of the nuts and bolts aspects as Controller, in addition to implementing the new ideas and initiatives.
- Nevada receives Federal Stimulus money through the American Recovery and Reinvestment Act (ARRA). Do you feel this money is being properly accounted for and efficiently used?
I have first-hand experience with these matters. In leading the regents’ Audit and Budget & Finance Committees, I’ve worked hard to assure that this money has been properly accounted for and efficiently used by the Nevada System of Higher Education. There are serious issues attending these questions for operations in many state and local governments, and even though this revenue source is winding down, it is important to give a full accounting to the public on these funds and issues. I will focus on answering them definitively in my early reports that I have committed to make regularly to voters, taxpayers state agencies, local governments and legislators.
- There have been calls in the past to eliminate the state Controller position, merging it into the state Treasurer’s office. Do you support such a merger? Please explain why or why not?
I’m open to discussing this possibility (and any other proposal for better governmental efficiency and effectiveness), although I’m not optimistic this one holds any promise. The Controller is Chief Fiscal Officer and the Treasurer is Chief Investment Officer, so the duties are substantial in both cases and distinct. Further, there is a case to be made that the two positions operate to some extent as a check on each other, thereby protecting the public interest.
However, even if one concluded that the two offices should be merged, any potential benefits are probably minimal and they would certainly be delayed. The benefits would be minimal because the working positions and missions of each office, being distinct, would not lend themselves to significant consolidation, efficiencies or thus savings. It’s not even clear that one of the two titular positions would actually be eliminated, although that would of course be one goal; with distinct duties, the combined Controller-Treasurer might well need separate well-paid CFO and CIO deputies. Even if one position could be eliminated – dubious if the Controller is to fill the public-information functions I’ve highlighted – the savings would be minimal in terms of the total budget of the two offices. And they would be delayed by at least six years, because it would take that long to pass the constitutional amendments (two electoral cycles) and legislation and other implementation details needed to effect the proposal.
As I said, I’m open to any discussion that will promote efficiency and effectiveness in the functions of the Controller’s office and others. But meantime, someone has to diligently attend to the duties of the office and do the work, and while any such discussion goes on, that’s what I’ll be doing.
- As Controller, would you support posting the state’s “checkbook” online on a public website, allowing taxpayers to see every expenditure?
This is perhaps the most important of the new ideas I would implement as Controller, and it reflects the spirit of the re-imaging the office and duties of Controller I have described here. I think this idea is essential and long overdue. I’ve already proposed it during the campaign, and I’m committed to it.
If there is an issue you are concerned about that has not already been addressed, this is your spot to address it:
This questionnaire has done an excellent job of describing the issues; thus, I have no new items to raise here. So, as I noted above, I’ll close by suggesting voters check out my resume that already appears on the Nevada System of Higher Education web site and my own web site and that has been attached previously to my filed expert-witness testimony and withstood cross-examination.